SECTION A- MULTIPLE CHOICE QUESTIONS.
PART 1 -ATTEM1'T ALL QUESTIONS)
I) According to the statement of responsibilities of internal auditing, which of the following is not included in the scope of the internal audit function?
a) Appraising the economy and efficiency with which resources are employed.
b) Reviewing the strategic management process, assessing the quality of management decIsion making both quantitatively and qualitatively, and rcporting tbe results to the audit committee.
c) Reviewing the means of safeguarding assets and, as appropriate, verifying the existence of such assets, d) Reviewing operations or programs to ascertain whether results are consistent with established objectives and goals and whether the operations or programme are being carried out as planned.
2) In an audit of financial statements, an auditor's primary consideration regarding an internal (;ontrol policy or procedure is whether the policy or procedure a) Reflects management's fmancial philosophy and operating style b) Affects management's financial statemcnt assertions.
c) Provides adequate safeguards over access to assets.
d) Enhances management's decision-making processes.
3) An audit of the financial statements of Camden Corporation is being conducted by an external auditor. The external auditor is expected to a) Express an opinion as to the fairness of Camden's financial statements b) Fxprcss an opinion as to the attractiveness of Camden for investmcnt purposes and critique the wisdom and legality of its business decisions.
e) Certify the correctness ot"Camden's financial statements.
d) Make a 100% exammation of Camden's records.

4) An auditor who accepts an audit engagement and does not have any knowledge about the organization should' a) Engage financial experts familiar with the nature of the organization b) Inform the management that he first needs to attend the MPCE programme before commencement of the audit.
c) Obtaining knowledge of matters that relate to the nature of the organization's business d) Refer a substantial portion of the audit to another member who will act as principal auditor e) Write the organization's legal adviser for legal advice
5) An auditor's permanent audit file usually includes a copy orthe a) Bank reconciliation statement b) Client's PAYE records c) Company's memorandum and articles of association d) Record of client's V A T returns to FIRS e) Details of NSITF deductions.
6) An auditor must exercise due professional care by a) Obtaming professional experience and formal education b) Examining all avail<lble corroborating evidence c) Critically reviewmg the judgment exercised at every level of supervision d) Reducing audit risk to the barest minimum e) Preventing fraud and irregularities.
7) Which of the following professional services is not offered by a Chartered Accountant in addition to his service as an auditor of a client?
a) Acting as a reporting accountant in an initial public offer b) Keeping client's accounting books c) Acting as referee to clients when opening a bank account d) Computation of income tax and filing tax returns e) Filing annual returns with the Corporate Affairs Commission on behalf of client
8) When an auditor becomes aware of a possible illegal act by a client, the auditor should obtain an understanding of the nature of the act to a) Evaluate the elIect on the financial statements b) Determine the reliability of management representation c) Consider whether other similar acts may have occurred d) Recommend remedial actions to the audit committee c) Consider whether to report the client to
EFee or ICPC
9) The professional ethics that guide auditors do not include one of the following: a) An auditor shall not interfere in the affairs of another professional b) An auditor may not hold financial interest in the company in which he is an auditor c) An auditor shall not take a loan or have any financial involvement in any client company d) An auditor cannot take up an appointment with a company owned by a blood relation or close relation c) An auditor cannot solicit for new client by means of advertisement.

QUESTlON,1
The institute of chartered Accountants of Nigeria has issued a guideline on the
Professional Ethics in order to ensure the interest of its members.
Enumerate the main features of the guidelines.
State the areas where the interest of the auditor could be in contliet with his independence posture in the discharge of his duties.

(a) Outline thc primary and secondary objectives of an audit.
(b) What arc the factors that contributed to the development of modern audit?
(c) Outline the seven advantages of auditing.
(a) Discuss the role of an internal audit department in a large organisation.
(b) Compare the role of an internal auditor with that of an external auditor
(c) Discuss the extent to which there can be effective liason between internal and external auditors and the precautions which should be taken by an external auditor before placing rehance on the work of an internal auditor
(d) State to whom ,in your opinion ,the internal auditor should report in a public company